Zillow Advice: Home Buying - FHA Loan with Downpayment Assistance Programs???

Certif you are smart enough ...

Tue, 27 Jan 2009 12:28:00 GMT

Cert

if you are smart enough to save up 3.5% for a downpayment, you should also be smart enough to do your research which should be telling you that prices are still dropping at about the rate of 3% plus per quarter. Thus, if you put no money down, using DPA and house prices continue their decline, you become 300% more likely to become a foreclsoure statistic when something happends 6 months from now and you need to sell your house.

You do realize that average transaction costs to sell a house are 6% right? Thus, you have significant negative equity in the event that something like a job loss happends - something that is becoming ever more possible as the recession deepends - for the next two years, TWO YEARS. Just yesterday fortune 100 companies announced 60,000 layoffs, one day.

I think you would be better off renting and continue to save for that downpayment.

Kind Regards

Gregorio, I thought someone ...

Tue, 27 Jan 2009 05:33:00 GMT

Gregorio, I thought someone would come along and say that. However, we have been smart to save up for a downpayment and closing costs. We are now working on saving for emergencies.

The reason I was asking this question was because if we can get help for the downpayment we can extra money at hand for other projects around the house.

Thanks for the input... more answers welcomed!

This is going to be an unpopular ...

Tue, 27 Jan 2009 04:34:00 GMT

This is going to be an unpopular answer, but it is what it is.

If you cannot afford the 3.5% FHA requires down, you should not be buying a home. Also, if you don't have a relative to "gift" you the funds for the down payment, you REALLY should not be buying a home. What happens when you stumble and have no reserves and no one to even help you?

3.5% is a minimal amount of money to save, if you can't save that much, you should rent; water heaters and new roofs are not your responsibility that way.

$.02

Do you know of any good non-profits ...

Tue, 27 Jan 2009 02:24:00 GMT

Do you know of any good non-profits that are reputable? Â I have looked around for the DPA programs and they all say that they have been discontinued with the FHA loans.

Downpayment assistance programs ...

Mon, 26 Jan 2009 14:05:00 GMT

Downpayment assistance programs are still available for FHA loans. The only program that is no longer permitted is seller-assisted down payments.

You can still use funds gifted from relatives, employers, churches, non-profit organizations and government agencies as sources for down payments.

You may also want to check out HUD's website at http://www.hud.gov/local/ca/homeownership/buyingprgms.cfm and the California Housing Finance Agency at http://www.calhfa.ca.gov/homebuyer/programs/chdap.htm